5 P.2d 1081 | Kan. | 1931
The opinion of the court was delivered by
Plaintiffs purchased, under a contract from the defendants, the Bankers Mortgage Company and Forrest C. Cave, a certain residence property in Kansas City. The residence was destroyed by fire. Defendants declined to rebuild. Plaintiff’s brought this action to have their interest in the property determined and to have it paid out of the proceeds of the insurance policy on the property. The trial court made findings of fact and rendered judgment for plaintiffs. The defendants have- appealed and contend: (1) That the contract gave plaintiffs only an option to buy the property; (2) that they had no claim in the proceeds of the insurance policy; and (3) that there was no basis for the judgment under the pleadings and the proof.
A fuller statement of facts should be made, which, briefly, is as follows: The record title to the property in question stood in the name of Forrest C. Cave, an employee of the Bankers Mortgage Company, and the property was encumbered by a mortgage to the Bankers Mortgage Company in the sum of $2,000. Plaintiffs formerly owned a small residence property in Kansas City, which they
To protect itself the insurance company made its draft in settlement of the loss payable to plaintiffs and the Bankers Mortgage
The principal controversy in the case hinged around the nature of the contract between the parties. On that point the court found:
“The court further finds that the transaction between the plaintiffs and the defendants, Forrest C. Cave and the Bankers Mortgage Company, was intended by all parties as the sale and purchase of the real estate described in plaintiff’s petition and in said contract, and said intention to purchase and to sell was evidenced by said contract so drawn as to be denominated an option contract, but as a matter of fact said instrument was executed by both parties as a convenient method of selling said property to the plaintiffs.”
Appellants complain of this finding and contend that the contract, by its wording, was a mere option, such as the court had before it in Caldwell v. Frazier, 65 Kan. 24, 68 Pac. 1076, and allied cases. The point is not well taken. Clearly the contract is not a simple option. It not only fixes the price of the property, but gives credit “on the purchase price” of the $400 down payment, provides that the monthly payments in excess of interest shall reduce the sum to be paid, and for the ultimate conveyance of the property when full payment has been made. It is true that it is headed “Option Agreement,” and contains many words and phrases suitable or common in pure option agreements, but these do not destroy the obvious purpose and nature of the contract. The contract should have been drawn fairly to represent the transaction in which the parties were engaged. To mingle into it terms and expressions with respect to an option foreign to the real purpose of the parties tends only to confusion. The court correctly found from the contract
Appellants further contend that under no view of the matter could plaintiffs have any interest in the proceeds of the insurance policy, since the title to the real property was in the name of Cave and the insurance policy in his name, and the Bankers Mortgage Company had a mortgage on the property for more than the amount of the’ loss, with a mortgage clause in its favor in the insurance policy. With respect to that the court found:
“The court further finds that the defendant, the Bankers Mortgage Company, is the owner and holder of a mortgage upon said property, but that it joined with the defendant, Forrest C. Cave, in the execution of said contract and thus and thereby became a party to the entire transaction.”
This finding was supported by the evidence. The contract with plaintiffs was executed by the Bankers Mortgage Company as well as by Forrest C. Cave. The evidence disclosed that the contract with plaintiffs was approved by the president of the Bankers Mortgage Company rather than by Forrest C. Cave; also that Forrest C. Cave was in the employment of the Bankers Mortgage Company — in short, that the Bankers Mortgage Company was as strongly bound to plaintiffs in this contract as was Cave.
The court found, among other things, that the plaintiffs had the use of the property, which was reasonably worth $25 per month, the amount of the monthly payments made on the contract, and found that their interest in the property at the time of the fire was $400. Defendants offered to show that the equity of plaintiffs in the small property which they traded for a down payment on the property in question was not worth $400; that that value was a trading value. The court excluded the evidence, and defendants offered it on the hearing of the motion for a new trial. Appellants complain of the exclusion of this evidence. It is true that when persons place a trading value on property, which is used in its exchange, greatly in excess of its true value, courts will in some cases hold their interest in the property acquired to be the true value of that exchange. But here the difference, in any event, could not be so great as to be very material. The evidence disclosed that plaintiffs had actually paid $290 on the former property, which
The trial court was confronted with a somewhat unusual situation and dealt with it fairly and judiciously. The result reached is just. There is no material error in the proceeding, and the judgment of the court below is affirmed.